Proposal might trim city tax cuts

A charter amendment could shift some funds from property taxes to land conservation

A proposed City Charter amendment could divert 1 percent of property tax revenues for land conservation and affordable-housing projects and result in $5 million less for possible tax cuts in fiscal 2007.

"We cannot reduce the property taxes as much as we had hoped because we have to account for this 1 percent," Budget Chairwoman Ann Kobayashi said. "That's a big concern of ours."

Kobayashi said the city still has to budget for the 1 percent for the next fiscal year even if the proposal does not pass. And to make room for that in the budget, she is looking at making further cuts so the Council can provide tax help to property owners, including a possible discount to residential owners.

It is one of 18 proposals approved by the Charter Commission for the general election ballot.

The proposal calls for 0.5 percent of revenues to be used for acquiring property for land conservation including protection of watersheds, forests, beaches, beach access, coastal areas, agricultural lands, historic properties, public recreation and open space.

The other 0.5 percent would be dedicated to expand and maintain affordable housing through land acquisition, development and construction.

"I think a lot of citizens would say tax relief versus 1 percent to really have green land and housing for our residents," said Darlene Hein, program director of the Waikiki Health Center's Care-A-Van homeless outreach. "I think it's OK to ask the residents what they think is the better way to go."

Josh Stanbro, Hawaii project manager for the Trust for Public Lands, said that based on the last budget, the 1 percent could amount to about $5 million.

"When you're looking at a $1.3 billion budget, it's not much," Stanbro said. "But what it does and the reason it's so important ... is it provides stable funding that you know will be there."

Stanbro said having the money in the bank would provide matching money for federal and state funds for land acquisition and protection, and for affordable-housing projects.

"So if you know those are coming in every year on a regular basis, and it's a set amount of property tax revenue, then the nonprofit partners or the city agencies that are working on those things can ... leverage those federal dollars," Stanbro said.

Stanbro said such funds could be used for purchases like the recent settlement that protected Waimea Valley.

"That's exactly what it's for," he said. "Even stuff like where we had flooding in Manoa and the last series of rains -- a lot of that is coming from upper watershed areas that aren't intact. You can do some hazard mitigation by acquiring and restoring watershed lands."

Kauai and Maui currently have a charter provision that sets aside 1 percent for land preservation purchases, and neither county has experienced any financial problems as a result of setting up those funds.

Mayor Mufi Hannemann's administration has testified against the Charter proposal, saying it is a noble idea but that it is also bad fiscal policy to earmark general fund revenues, administration officials said.